Videos
(Learning Objective 1) Which of the following management responsibilities often involves evaluating the results of operations against the budget?
- a. Planning
- b. Directing
- c. Controlling
- d. None of the above
To identify: The activity which involves evaluating the results against the budget
Answer to Problem 1QC
Option c. Controlling is the management responsibility which involves evaluating the results of operations against the budget.
Explanation of Solution
Management responsibilities: The management of the organization is responsible for various functions like planning, directing, controlling, and decision making in order to achieve the success. A manager implements the established standards, thinks of various alternatives in order to meet the defined standards or budgets and identify the factors leading towards undesirable results.
a.
Planning: Planning is the first and foremost function performed by the manager which is concerned with defining objectives and goals of the particular entity and the manner in which these goals can be achieved. While planning, the management sets particular standards in the form of budgets. Budgets are defined after a due observation of the financial structure of the organization. However, planning deals with the formation of budgets but it does not involve comparing the budgets with actual results. Thus, this option is incorrect.
b.
Directing: Directing is the activity which includes supervising the daily operations of the business entity. Directing involves taking small decisions which are concerned with sales or products such as the deciding the promotional plan for a particular product in order to boost its sales. Thus, this option is not correct.
c.
Controlling: Controlling is the responsibility of management which deals with the revaluation of plans and actions by comparing the actual results obtained and the standards set against them. Controlling is a kind of feedback which determines to what level an entity has been successful in its operations. Thus controlling is the responsibility of the management which involves evaluating the result of operations against the budget. Therefore, the option is correct.
d.
None of the above: The management activity which involves comparing the budgets and actual results is controlling. Thus, this option is incorrect.
Want to see more full solutions like this?
Chapter 1 Solutions
Managerial Accounting (5th Edition)
- Preparing performance reports that contain data only about items that a specific manager controls is an example of which of the following? A. Financial reporting B. Learning and innovation C. Management by exception D. Responsibility accountingarrow_forward1. Budgeting involves ________. establishing specific goals executing plans to achieve the goals periodically comparing actual results with the goals All of these choices are correct. 2. Budgeting affects all of the following managerial functions except ________. planning directing controlling None of these choices are correct.arrow_forwardhow can I apply MIS ( management information system ) successfully in this topic: A PERSONAL BUDGETING/EXPENDITURE SYSTEM (TRACKING OF EXPENSES AND INCOME, REPORTING DEFICITS)arrow_forward
- _______ can be defined as compelling events to go according to plan. A. Budgeting B. Management by exception C. Control D. Responsibility accountingarrow_forwardWhich one of the following is related to the decision making function of management: O a. None of the given answers O b. Choosing among alternatives О с. Performance reports d. Budgeting e. Establishing goalsarrow_forward3. For budgets to be effective: O A. Objectives should be attainable. B. There should be management approval. C. They should be developed from the "bottom-up". D. Both A and B. E. A, B, and C.arrow_forward
- Which approach requires management to justify all its expenditures? A. bottom-up approach B. zero-based budgeting C. master budgeting D. capital allocation budgetingarrow_forwardWhich of the following is NOT true of the budgeting process? Question 8 options: Budgeting provides feedback to management to aid in assessing how well it's reaching its goals. Budgets force managers to plan for the future. Budgets force managers to consider relations among operations across the entire value chain. The performance report is prepared as part of the master budget.arrow_forward1. Explain the concept of responsibility accounting and its relation with budgeting.2. Explain how the choice of the type of responsibility center (cost, revenue, profit, orinvestment) affects behavior.3. Discuss the concept of “budgetary slack”arrow_forward
- (3) Explain the ethical considerations as it relates to using budgets as a basis for rewarding managers? (4)Explain three specific benefits that a system of budgetary planning and control may bring to an organization.arrow_forwardSubject- accountingarrow_forwardAll of the following is related to the controlling function of management except: a. Performance reports b. Gathering feedback c. None of the given answers d. Establishing goals e. Comparison between actual and budgeted resultsarrow_forward
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Pkg Acc Infor Systems MS VISIO CDFinanceISBN:9781133935940Author:Ulric J. GelinasPublisher:CENGAGE L